The sleek passenger jet sits idle on the east side of McClellan-Palomar Airport. Its white fuselage and light blue letters read, “California Pacific.”

It looks ready to fly, but isn’t.

The airline — California Pacific — is in a dispute with the Federal Aviation Administration that has brought its licensing status back to the early stages of a complex process that can take months.

This isn’t what Ted Vallas expected would be happening right now at the North County airport when he filed his application to start an airline in April 2010.

Vallas, 91, thought that by now his airline would be flying in and out with multiple planes, offering nonstop service to San Jose, Oakland, Sacramento, Las Vegas, Phoenix, and eventually Cabo San Lucias.

The Embraer 170 regional jet — the aircraft California Pacific would use — landed to media fanfare in July. It was being touted as a commercial airline for North County, an opportunity for those who live in between John Wayne Airport in Orange County and downtown San Diego’s Lindbergh Field to have a convenient airport. But that leased plane — with its 72 seats — still sits alone at Palomar, while Vallas pays $200,000 a month in rent just for the aircraft.

The dispute with the FAA has been brewing since 2011, but the tipping point came in November 2012. That’s when the agency informed Vallas that it was returning his application to a preliminary phase.

The U-T obtained letters from Vallas and the FAA outlining the dispute through the Freedom of Information Act.

“FAA has expended significant resources in man-hours and travel funding to accomplish certification oversight tasks associated with the CP Air Project,” FAA San Diego field manager Jerome Pendzick wrote to Vallas in November. “The actual performance of CP Air has not been what was expected, and as such, the FAA now finds itself facing serious doubts about the possibility of a successful certification of CP Air.”

Vallas, who founded charter service Air Resort Airlines in the 1980s, said Tuesday that he is still pushing for the airline. He still hopes to have it running in three to six months.

“I really wouldn’t have a story to tell,” he said. “We’re right in negotiations.”

Vallas said he is continuing to fundraise — he’s up to $10 million, and is pursuing an additional $11 million.

The FAA, which upgraded the application in December after some back and forth with Vallas, cited major concerns with documents that California Pacific submitted outlining procedures involving maintenance, safety, flight crew training and personnel. Those are the requirements in the application process.

Vallas argues that the San Diego FAA office — the Flight Standards District Office, or FSDO — acted with bias against California Pacific in 2011 when it revoked and then reinstated its certification to commercially fly the E170 out of Palomar. Vallas said the suspension stifled fundraising efforts, led to a loss of key employees and made it all but impossible to promote the business.

“Given the consistent biased tone from the local FSDO, we have no choice than to escalate this issue and request that the current team be removed from this process as we move forward,” he wrote.